Iceland is conducting an experiment that may forever change how energy is supplied. Science, politics and the corporate world are working together here to make a break from our dependence on coal, oil and gas. In the future, this small island nation will get its energy from the H2 in H2O. The first steps have begun and in 25 years the world's first hydrogen economy may be a reality - clean, sustainable, endless. The world is watching closely, and these pioneering Vikings are confident it will follow their lead.

A meeting in Reykjavik. At 9.00 on this Monday morning Bragi Árnason is waiting on the stairs of his institute. Ominous clouds cover the last of this year's summer sun in Iceland. The only colour dotting the landscape comes from the cheerfully painted house and from Árnason's spontaneous enthusiasm. For 25 years he has been touting the hydrogen economy as the answer to this isolated country's dependence on fossil fuels. His compatriots laughed at first - 'cars that run on water..?' Now he is a hero, known affectionately as 'professor hydrogen,' who has connected little Iceland with multinational giants such as Shell, DaimlerChrysler and Norsk Hydro. He is the man who turned a local experiment into an example for the world to behold. Árnason rushes through the hall of his institute to show off a recent acquisition in his laboratory. On a table by the window is a demonstration model. To the far left a small solar panel absorbs light, which is then converted into electricity. The electricity runs to an electrolysis device that separates water (H2O) in a container into hydrogen (H2) and oxygen (O2). The two pipes containing H2 and O2 continue and then rejoin in a small so-called fuel cell in which they again react to become water, thereby generating electricity. That energy is used to turn a little windmill in Árnason's laboratory. The water runs out of the fuel cell back into the first reservoir where it is again separated by electrolysis. This closed circuit of energy, which neither pollutes the air nor disrupts the climate, can continue to function as long as the sun shines on the earth - that is to say, a couple of billion years. This is the vast potential of the hydrogen economy.

The little windmill turning in the laboratory is a symbol for Árnason's vision of the future: all the combustion engines in cars and fishing boats in Iceland can be replaced by electric motors powered by hydrogen fuel cells. At the same time, Iceland can use its rich natural resources to generate electricity in a sustainable way, which is needed for the production of hydrogen via electrolysis from water. The inhabitants of Iceland even see themselves exporting hydrogen, and dream of a future for their country as the 'Kuwait of the north'.

Energy experts agree that in the long term, hydrogen is the only alternative to the fossil fuels keeping today's global economy afloat. Solar energy can be used immediately - Árnason's windmill can also be directly connected to the solar panel - but the 'detour' via the production of hydrogen is important, because cars should also be able to operate when the sun is not shining. Like oil and gas, hydrogen can be stored and used when needed.

Hydrogen is the most widespread element in the universe. The only problem is that it is nearly always bound - in water and in hydrocarbons, such as natural gas (CH4). There is plenty of water in the ocean. So the only thing needed for the hydrogen economy is electricity generated in a sustainable fashion, used to separate the hydrogen from the water. But that is easier said than done. Although the use of solar and wind energy is increasing 30 percent a year, sustainable electricity only represents 2.2 percent of the world's energy supply. Iceland, however, is a notable exception. While the world awaits the decisive breakthrough of such alternatives as wind, solar, biomass and tidal energy, the island's electricity is already generated by fully sustainable means. This is why Iceland's hydrogen economy is more than just an inspired professor's dream.

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An hour's drive from Reykjavik is a large power station. The road leading there runs through a bizarre landscape of moss-covered solidified lava. A few odd blades of grass, reaching 20 centimetres high, rise from the ground. Trees and bushes are only visible in the gardens of a very few rich Icelanders. Iceland looks like a moonscape, or so thought the leaders of the Apollo lunar flights, who brought astronauts there to train. Clouds of smoke rising from the monotonous landscape signal the approach of the power station. The chimneys and turbines look like every other power station. Yet everything here is different. For the past 20 years this station has generated electricity with the help of steam spewing from the earth. In Iceland, geyser energy is used to generate electricity. The 'clouds of smoke' from the chimneys are only water vapour. The overflow from the power station even created an unusual lake that has become the largest tourist attraction in Iceland. Even in the pouring rain, scores of people wade through the warm (39 degrees Celsius!), unbelievably blue water. The water in this Blue Lagoon, rich in silicon, has also proven to be extremely effective in treating such skin diseases such as eczema and psoriasis.

So-called geothermal energy and hydropower handle all of Iceland's electricity needs. And not even 20 percent of its potential has yet been tapped. If you drill a hole nearly anywhere on the island, a geyser will explode with enough force to drive a turbine. But this potential surplus of sustainable electricity is not sufficient to meet all of Iceland's energy needs. For transports and industry, Iceland is still dependent on imports of oil and coal. Those imports account for 32 percent of all energy use and cost the country _120 million a year. But these proud Vikings, who descended on the island in the 9th century, continue to suffer the most from their dependence on oil and coal, tucked away in this North Pole region, hundreds of miles from the source of these fossil fuels. Which is why Bragi Árnason started a research project in 1962 after finishing his chemistry degree in Germany. 'It was natural to research how we could replace our dependence on fossil fuels with our extensive domestic energy reserves,' he says. That project ultimately led to hydrogen. In 1978, Árnason wrote his first report, in which he suggested using hydrogen as fuel for industry and transport. He told his story at Iceland's Rotary clubs, where he was often received with compassionate smiles and looks of disbelief. The story might have ended there if it hadn't been for a coincidental chain of events, which has pushed Iceland to the forefront of a new energy age.

The first thing that happened was that in 1977 Professor Árnason met a young MP named Hjalmar Árnason (no relation) who was attending one of his lectures on a gloomy winter's evening in Reykjavik. This MP was very enthusiastic about the professor's ideas and took the concept of the hydrogen economy to the country's parliament. With some difficulty, he managed to persuade a parliamentary committee to study the initiative. The prospect of a report that might end up filed away and forgotten loomed, but the committee's conclusions found their way to The Economist's editorial office in London. A journalist called Árnason while he was engaged in his favourite hobby: fishing for salmon in one of Iceland's rivers. In his zealousness, Árnason let slip that the transition to a hydrogen economy could be completed by 2030. The resulting article reached executives at Daimler (now DaimlerChrysler), which at that time was considering how to respond to increasing criticism of the automotive industry's contribution to air pollution and global warming. 'They're doing something in Iceland,' one executive muttered, and a delegation went off to have a look.

MP Hjalmar Árnason remembers well what happened next. Daimler's arrival prompted one of the biggest media events in the island's history, which is not accustomed to being in the spotlight. 'We had to meet in secret.' That meeting had an impact. 'Here, something is only true if someone from abroad says it is,' Árnason says. Thus the hydrogen economy became a fixed item on Iceland's agenda.

Shell was the second multinational to arrive in Reykjavik. The hydrogen experiment fit seamlessly into the company's plans. Moreover, the oil giant had set up a special hydrogen division - Shell Hydrogen - in 1998. Professor Árnason recounts that he once asked a delegation from Shell why they wanted to participate in the Icelandic experiment. 'We are here because we want to be a fuel cell company in 50 years,' they replied.

Iceland is an ideal 'laboratory' for experimenting with the hydrogen economy. The country has only 280,000 inhabitants, but the infrastructure is comparable to that of any other modern industrial nation. (Over the past century, Iceland has evolved from one of the poorest countries in Europe to one of the world's richest.) The extreme weather conditions offer an added advantage for testing the new technology.

Norsk Hydro, which manufactures electrolysis instruments among other products, became the third foreign partner. Together, these three companies set up Icelandic New Energy, which is 51 percent state-owned. Icelandic New Energy's task is to move the country towards a hydrogen economy in phases. The partnership with the three western multinationals reflects the fact that Iceland cannot achieve a sustainable economy alone. The production of hydrogen using sustainable electricity is not the problem. But, as the Icelandic New Energy's chairman, professor Thorsteinn Sigfusson, says: 'We need cars, so we need the world.'

The development of the fuel cell is crucial in order to make a clean car. The principle of the fuel cell dates way back to 1839 when it was discovered by Sir William Robert Gove of the UK. It has been used in aerospace technology for decades, but for a long time it was a heavy, large and expensive device - unsuitable for commercial applications such as in cars. But then 10 years ago the development of the fuel cell took off. This happened under the leadership of the Canadian manufacturer Ballard Power Systems, which developed a hydrogen fuel cell bus for Vancouver in 1992. The bus had a capacity of 150 kilowatts, over 15 times the level experts had considered possible for a fuel cell. This turned out to be a crucial breakthrough. Meanwhile, the first prototypes of cars with electric motors powered by fuel cells have entered the testing phase. DaimlerChrysler aims to be the first car manufacturer to launch production of a fuel cell car in 2004, and other car manufacturers have joined the race, which will have a positive impact on Icelandic New Energy's scenario for Iceland.

Next May, Shell will open its first fuel station in Reykjavik, where consumers can fill up their cars with hydrogen produced on site. At the same time, the first DaimlerChrysler fuel cell car will go into operation. Later that year the first three fuel cell buses manufactured by the company will begin riding the streets of Reykjavik. The city's other 70-odd buses will gradually be replaced. Recently, it was also agreed that in three years the first prototype of a fishing ship powered by a fuel cell will be unveiled. The next obvious question is, how quickly will the 180,000 Icelandic car owners and 2,500 fishing vessel proprietors embrace the new technology? MP Árnason is optimistic: 'People everywhere ask me every day: 'when will the cars be available?' I'm convinced that Icelanders will buy fuel cell cars in large numbers when they come onto the market. We are known for setting world records in the launch of new technology, such as computers and mobile telephones.' Árnason also points to the attractive prospect of quieter ships once they are powered by electric engines. 'The continual pounding of the engine is tough on the crew, and moreover, chases away the fish. I'm convinced that silent fuel cell ship engines will sell like hot cakes as soon as they go on sale.'

Icelandic New Energy expects to have fully completed the transition to the clean, sustainable hydrogen economy in 2025 (see box). That year will mark 50 years since Bragi 'professor hydrogen' Árnason first articulated his vision. 'The transition from wood to coal took three generations. As did the step from coal to oil. I'll see the first stages of the hydrogen economy. My children will experience the transformation and my grandchildren will live in this new economy,' says Árnason. The transition could technically be done more quickly, but as Sigfusson of Icelandic New Energy explains: 'We cannot build our society on prototypes.' In other words, international industry needs to hurry and catch up. But there is good reason for optimism. After 30 years of experience with hydrogen, Bragi Árnason says dryly: 'There has never been a hydrogen power project that has met its deadline. Every initiative was realised ahead of schedule.'

Source: Ode Magazine

ENN would like to thank Ode Magazine for their permission to reprint this article.